Senator Warns of Severe Medicare Cuts for Nursing Homes

Victims of nursing home abuse and industry stakeholders gathered in Washington this month for a Senate hearing on the nursing home industry. In addition to hearing testimony from the families of nursing home abuse, the federal legislators sounded the alarm over a looming fight over Medicaid funding. According to Skilled Nursing News, the Trump administration will propose its plans to convert Medicaid funding into a “block-grant model.”

According to proponents of the new model of funding, Medicaid spending has spiraled out-of-control and the federal health insurance scheme is no longer sustainable. Instead of continuing with the current open-ended model, the federal government will fund a predetermined amount each year for a state’s Medicaid program. The amount will likely depend on the number of Medicaid beneficiaries in the state, among other factors. The idea for overhauling Medicaid’s open-ended funding model into a block grant system has been favored by Republicans for a long time and finally reached a fever-pitch during the Affordable Care debate in 2017.

Proponents and critics of changing Medicaid’s funding say the new model will potentially reduce Medicaid’s payouts by hundreds of billions of dollars. For the nursing home industry, the sharp reduction in funding could be catastrophic. According to an analysis by the Kaiser Family Foundation, Medicaid currently covers about 62 percent of all nursing home residents. Multiple studies have shown that the amount of funding a nursing home receives is directly related to the quality of care provided to its residents. For lawmakers hoping to reduce the unacceptable amount of nursing home abuse and neglect in the nation’s nursing home industry, a massive cut to the Medicaid program would be counterproductive.

At the Senate hearing, the issue of Medicaid funding appeared to break on political fault lines. Sen. Ron Wyden, a Democrat from Oregon, complained that the looming proposal by the Trump administration would “turn back the clock on efforts to improve care and it would inevitably lead to more nursing homes closing their doors, which would especially work a hardship in rural America.” The Senate Republicans did not appear to comment on the new funding model but did seem to find a bipartisan consensus on increasing accountability for nursing homes. Sen. Chuck Grassley, Republican of Iowa, described, “A systematic problem that does not seem to respond to whoever’s in control of any bureaucracy here.”